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Budget committee flags tax shortfalls, Riverwalk grant and storm costs in March financial review
Summary
Council Rogers led a review of March financials noting a shortfall in corporate replacement/local use taxes (~$400,000 to date), an unexpected $300,000 Riverwalk grant, a sharp drop in hotel tax revenue and anticipated seven-figure storm-related expenses that could widen budget gaps.
At the April 2026 Kankakee City Budget Committee meeting, Council Rogers walked members through the March financial statements and highlighted revenue shifts and expense pressures that will shape the next budget year.
Rogers told the committee that corporate replacement and local use tax receipts were significantly below expectations and estimated the city was about $400,000 short so far; he said final accruals in July will determine the year-end picture. "We will pick up some in the income tax area, but I expect both of those to be lower for next year," Rogers said.
Rogers noted several other revenue items: franchise fees rose (driven in part by payments from Aqua); grants and service charges were above budget thanks in part to a $300,000 Riverwalk grant; and fines have rebounded after code-enforcement staffing improved. By contrast, hotel-tax revenues fell sharply — the committee heard that the largest hotel’s revenue has dropped roughly in half in the recent period — and that trend contributed to lower lodging-tax receipts.
The committee discussed collection of taxes on online short-term rentals such as Airbnb. Staff said Dawn is working to identify and register short-term rental listings and to seek compliance from booking platforms; full compliance and a complete revenue picture may take a year or two to establish.
Rogers reviewed expenditures and said most departments are at or under budget. He reported that salary, wages and overtime year-to-date are at about 84.7% of budgeted levels, but cautioned that storm-related cleanup and repairs will add costs. City staff reported that about 78 municipal vehicles and numerous city roofs and facilities were inspected after a recent storm; managers said replacements and repairs are likely and that insurance may not cover the full cost. "I don't know what our final claim number will be. I'm sure it'll be well north of seven figures," one manager said.
The committee also discussed ECDA-related budget exposure. Rogers said the city included a $200,000 contingency for the Economic Development Corporation of America (ECDA) but that some administrative and lease costs the ECDA previously covered may transfer to the city. Members asked staff to track those obligations so they can be reflected in future budgets.
Procedurally, the committee approved the February and March meeting minutes earlier in the session. Staff and councilors said they will follow up with additional detail on short-term rental compliance, hotel-revenue conversations with hotel operators and final storm-claim estimates.
The review will feed the city’s midyear budget work and the close of the fiscal year once state accruals and final revenue data arrive in July.
